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Note 8 - Intangible Assets

6 Months Ended

Jun. 30, 2025

Notes to Financial Statements

Intangible Assets Disclosure [Text Block]

NOTE 8 INTANGIBLE ASSETS

Intangible assets at June 30, 2025 and December 31, 2024 are comprised as follows:

(in thousands)		June 30, 2025
		Gross Carrying Value				Accumulated Amortization				Accumulated Impairment Losses				Net Carrying Value
Intangible assets subject to amortization:
Database		$	4,918			$	4,918			$	—			$	—
Vehicle service agreements in-force			3,680				3,680				—				—
Customer relationships			51,787				29,126				—				22,661
Developed technology			651				110				—				541
Intangible assets not subject to amortization:
Trade names			19,267				—				2,335				16,932
Total		$	80,303			$	37,834			$	2,335			$	40,134

(in thousands)		December 31, 2024
		Gross Carrying Value				Accumulated Amortization				Accumulated Impairment Losses				Net Carrying Value
Intangible assets subject to amortization:
Database		$	4,918			$	4,918			$	—			$	—
Vehicle service agreements in-force			3,680				3,680				—				—
Customer relationships			51,242				25,765				—				25,477
Developed technology			600				79				—				521
Intangible assets not subject to amortization:
Trade names			16,167				—				2,116				14,051
Total		$	76,607			$	34,442			$	2,116			$	40,049

As further discussed in Note 5, "Acquisitions and Discontinued Operations," during the first quarter of 2025, the Company recorded $3.6 million of separately identifiable intangible assets, related to acquired customer relationships and trade name, as part of the acquisition of Bud’s Plumbing on March 14, 2025. The customer relationships intangible asset of $0.5 million is being amortized over six years, based on the pattern in which the economic benefits of the intangible asset is expected to be consumed. The trade name intangible asset of $3.1 million is deemed to have indefinite useful life and is not amortized. The intangible assets related to this acquisition are provisional and subject to adjustment during the measurement period. The Company expects to complete its purchase price allocation within the next three months. The estimates, allocations and calculations recorded at June 30, 2025 are subject to change as we obtain further information; therefore, the final fair values of the assets acquired and liabilities assumed may not agree with the estimates included in these consolidated financial statements.

The Company's intangible assets with definite useful lives are amortized either based on the patterns in which the economic benefits of the intangible assets are expected to be consumed or using the straight-line method over their estimated useful lives, which range from 5 to 15 years. Amortization of intangible assets was $1.7 million and $1.5 million for the three months ended June 30, 2025 and June 30, 2024, respectively ($3.4 million and $2.9 million for the six months ended June 30, 2025 and June 30, 2024, respectively).

The trade names intangible assets have indefinite useful lives and are not amortized. Indefinite-lived intangible assets are assessed for impairment annually as of November 30, or more frequently if events or circumstances indicate that the carrying value may not be recoverable. The Company may perform its impairment test for any indefinite-lived intangible asset through a qualitative assessment or elect to proceed directly to a quantitative impairment test, however, the Company may resume a qualitative assessment in any subsequent period if facts and circumstances permit.

At each quarter end of the first and second quarters of 2025 and 2024, the Company determined that certain trade names should be further examined under a quantitative approach due to actual revenue coming in lower than previous projections. Based upon these assessments, the Company recorded impairment charges for the three and six months ended June 30, 2025 of $0.1 million and $0.2 million, respectively, related to the Ravix indefinite-lived trade name, and $0.7 million and $1.2 million for the three and six months ended June 30, 2024, respectively, related to the SNS and CSuite indefinite-lived trade names. The fair value of the Ravix, SNS and CSuite trade names were estimated using the relief-from-royalty method. The significant unobservable inputs used in the relief-from-royalty method, which are level 3 inputs, include a royalty rate and discount rate. The reduction in value is primarily due to higher discount rates and a reduction in projected revenue. Future impairments may be recorded if discount rates increase further, or if actual revenue falls short of current projections. The valuation of these assets is not dependent on the underlying profit or loss generated by the respective business. Therefore, even if a change in revenue does not have a significant impact on operating results, it could significantly impact the fair value of the trade name.